I was recently enjoying a beer with an old college buddy who’s an avid investor. At one point he said: “Pandemic. Inflation. War. The investing rules are different this time around.”

Oh boy. I immediately set him straight. Certain immutable laws govern the economy and financial markets. They don’t change over time. It’s like saying “gravity doesn’t always apply” and jumping off a roof.

Pick a fairly valued company that you understand. Make sure it’s selling products and services that people need. Insist on a solid balance sheet. Keep an eye on economic cycles. Beware of excessive valuations. These guidelines never go out of style.

An investor who says time-tested rules are obsolete is about to make decisions that lose money. Time, not timing, is what really matters.

Let’s examine the latest market action and see why, despite unnerving developments, you should stick to your long-range plan.

Powell, Putin, and power politics…

In pre-market futures contracts Tuesday, U.S. stocks were trading in the green, after taking a breather Monday. Last week the S&P 500 jumped 6.2%, its strongest weekly gain since 2020.

Federal Reserve Chair Jerome Powell’s remarks Monday weighed on stocks. He commented that “inflation is much too high” and that the Fed stands ready to get more hawkish to tackle it.

Read This Story: For The Markets, Powell Outranks Putin

Geopolitical turmoil has not eased, in the wake of Ukraine’s steadfast refusal of Russia’s insistence that it surrender the besieged city of Mariupol. Commodity prices, which already have been on an upward trajectory, have spiked.

Crude oil prices have been volatile but rising, as European Union members contemplate an embargo on Russian crude. See the following chart of per-barrel prices of West Texas Intermediate (WTI), the U.S. benchmark, over the past three months:

Source: U.S. Energy Information Administration

The energy and basic materials sectors have led advancers in recent days, although an undercurrent of nervousness is reflected by the outperformance of such defensive sectors as utilities and consumer staples.

Within the energy sector, midstream master limited partnerships (MLPs) look particularly appealing. Economic growth is likely to continue pushing up oil prices, while logistical bottlenecks are increasing demand for pipeline transportation.

Also consider aerospace/defense, a recession-resistant sector that actually benefits from headline risk. Military purveyors make effective inflation hedges, too.

The yield of the 10-year Treasury note hovers above 2.3% for the first time in nearly three years. The increase in longer-term rates is steepening the yield curve, which reflects the Fed’s aggressive tone. But this dynamic also can be interpreted as a sign of healthy economic growth.

My generally bullish outlook remains intact. Last week’s stock market rebound slashed the year-to-date slump by roughly 50%. That’s great solace, considering the backdrop of hot inflation, rising interest rates, and the worst outbreak of war in Europe since WWII. The consumer, corporate earnings, and broader economy are on a solid footing.

To be sure, corporate earnings growth has slowed. For the first quarter of 2022, the estimated earnings growth rate for the S&P 500 is 4.8%, according to research firm FactSet. But earnings haven’t fallen off a cliff and they were bound to decelerate as the abnormally low pandemic-induced baseline recedes.

Value plays have taken the vanguard over large-cap growth so far this year. Rising rates pressure growth stocks, especially tech shares, as seen by the NASDAQ’s sharp decline year to date.

However, innovation is so powerful right now, the tech sector remains a shrewd long-term play. Consider tech stalwart Apple (NSDQ: AAPL).

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John Persinos is the editorial director of Investing Daily.

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